A Virginia court on Wednesday granted GlaxoSmithKline PLC’s request for a preliminary injunction blocking the U.S. Patent and Trademark Office from imposing new rules that the pharmaceutical company says will harm innovation.
During a hearing in the U.S. District Court for the Eastern District of Virginia, Judge James Cacheris temporarily delayed implementation of the proposed rules, which reduce the number of times a patent applicant can contest or amend rejected or pending patent claims.Previously, applicants could file an unlimited number of amendments or challenges, known in industry parlance as “continuations.”"It’s a good day for innovators in this country because the new rules would have stifled innovation,” GlaxoSmithKline’s lawyer, John Desmarais, told Dow Jones Newswires.Under the new rules, which were scheduled to go into effect Thursday, applicants had the right to file two continuations, but anything above that would have to be accompanied by an explanation justifying the request.Continuations are considered an important tool by patent applicants, particularly in the competitive pharmaceutical industry, because new information about an invention often comes to light after the initial patent application has been filed.The Patent and Trademark Office wants to limit the number of continuations to help make the patent-application process more efficient, and to reduce its massive application backlog.Continuation requests accounted for nearly 30 percent of all patent applications in 2006, up from 27 percent in 2005 and 25 percent in 2004, according to the Patent and Trademark Office. The patent-application backlog stands at 750,000.Critics of the existing system also note that many companies use continuations to delay introduction of a product, monitor market developments and then modify their patents to take advantage of emerging trends.On the flip side, opponents say the new rules were unclear, stifled innovation and would make it more expensive for small companies and individual inventors to patent their inventions.Britain’s GlaxoSmithKline filed its suit against the U.S. Patent and Trademark Office and its director, Jon Dudas, earlier this month. It will now file another motion asking the court to block the new rules permanently, Desmarais said.The Patent and Trademark Office will also file a motion arguing against a permanent injunction and for the rules to be implemented, he said. The case will likely be argued early next year.”I think GSK’s position in this case is very strong on the merits and we’re very pleased that the court has come out the way it did,” Desmarais said.A Patent and Trademark Office spokeswoman, Brigid Quinn, said in an e-mailed statement that the proposed rules “are part of a package of initiatives designed to improve the quality and efficiency of the patent process and move American innovation and our economy forward.”Nearly 97 percent of the patents issued in fiscal year 2007 met stringent independent quality standards, up from about 93 percent in 2000, the statement said. Additionally, the office’s patent appeals board upheld examiners’ decisions to reject patents almost 70 percent of the time last year, up from 51 percent in 2000, Quinn said in the statement.Before Wednesday’s decision, Cacheris had sided with the Patent and Trademark Office in four cases challenging its authority.The battle over the new continuation rules comes as the U.S. Senate prepares to vote on a controversial patent-reform bill designed to curtail the power of patent holders. Among other things, the bill would reduce damage awards for infringement, limit venue choice in patent litigation and create a new way of challenging a patent’s validity after the patent has been approved. Copyright 2007 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.